Seattle Mayor Targets 'Surveillance Pricing' At Grocery Stores

Seattle leaders are moving forward with a first-of-its-kind proposal aimed at preventing grocery retailers from using consumers' personal data to charge different prices for the same products.

The ordinance, backed by Mayor Katie Wilson and City Councilmembers Alexis Mercedes Rinck and Dionne Foster, would prohibit large grocery chains from using information such as browsing history, social media activity, employment status, race, gender, or chatbot interactions to personalize prices, according to Wilson's website. 

Instead, retailers would be required to publicly display uniform prices while still allowing traditional discounts for seniors, veterans, loyalty programs, and other transparent promotions.

"This policy stops corporations from using personal data to squeeze more money out of shoppers," Wilson said. "The same product, in the same store, should cost the same no matter who's pushing the cart."

The announcement on Wilson's site says that the measure is designed to curb AI-driven price discrimination as grocery costs continue to rise. The proposal follows a Consumer Reports investigation that found Instacart tested AI pricing systems that charged different customers different prices for identical grocery items. It also comes after Washington's attorney general sued Albertsons over allegedly misleading "buy one, get one" promotions that did not actually reduce prices.

Councilmember Rinck argued the legislation would establish "guardrails" around how retailers use customer data, particularly as many households face higher food costs and reduced SNAP benefits. Foster added that consumers "shouldn't have to wonder whether they're being charged extra because of an algorithm."

Labor and privacy advocates also praised the proposal. UFCW 3000 President Faye Guenther accused grocery companies of pursuing "AI-powered surveillance pricing tech" to create "fake discounts," while privacy advocates said the ordinance would help prevent algorithmic price discrimination before the practice becomes widespread.

If approved, Seattle would become the first U.S. city to adopt rules specifically banning the use of sensitive personal data to set individualized grocery prices.